Summary:

Late November 2023 data released by the National Institute for Statistics (INS) indicated that Tunisia’s trade deficit continues to widen as imports increase and exports decrease. 

Compared to September 2023, the trade deficit grew by nearly 27%, which can indicate shrinking GDP and could further weaken the power of the dinar. 

While energy exports rose in October 2023, nearly all other exports fell. According to the INS, if the data excludes energy products, overall “exports fell by 2.1%, while imports increased by 9.2%.” 

Exports to France, Tunisia’s largest trading partner, have continued to rise throughout 2023, even as exports to the EU have steadily tapered over the same period. 

The new INS trade data comes as the Ministry of Trade and Export Development implemented a freeze on prices of non-subsidized goods, including canned food, soft drinks, some milk products, as well as some hygiene products.

Outlook: 

As domestic production has lagged, particularly in the agricultural sector that has faced the impacts of a multi-year drought, Tunisia has become increasingly reliant on imports. 

In the face of limited government buying power and rising inflation, the buying power of Tunisians has consistently fallen, particularly in light of rising prices globally. Price freezes meant to protect consumers will further penalize the country’s private sector, placing additional pressure on insolvent state enterprises in the long-term. 

Promises that painful economic reforms will not be undertaken in 2024 combined with an increasingly adversarial approach to diplomatic and international economic relations will likely compound Tunisia’s economic challenges in the near- and medium-term. 

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